Transcript Board Meeting Presentation

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IR meeting – June’2010
Slide no. 1
Structure of presentation

TVS Group

Industry outlook

TVSM : Poised for quality growth
IR meeting – June’2010
Slide no. 2
The TVS Group
Established 1911
Two-Wheelers
& Three Wheelers
Auto Components
A fast growing
Automobile Company
in India
Largest Auto
Components
Manufacturer in India
IR meeting – June’2010
Vehicle Dealership
& Logistics
Largest Auto parts
distributor
Largest car and truck
dealership In India
Non-automotive
Pioneers in IT
Hardware in India
and
Financial Services
Slide no. 3
TVS Group - Our Journey
• Exports to over
30 countries
Entry into Electronics
Manufacturing
• Largest in India
Dealership
Agreement with GM 1929
Auto Components
Manufacturing 1961
Established
Overseas plants
Launch of
Logistic Network
Launch of Bus
Service - 1911
1920
Three wheeler
Manufacturing
Two wheeler
Manufacturing
Begin Financial
Services
1930
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1940
1950 1960
1970
• Exports of 2W to
55 countries
1980 1990 2000
2009
Slide no. 4
TVS Group - Awards & Recognition

Deming Quality Award
 Sundaram Clayton
 Brakes India
 TVS Motor Company
 Sundaram Brake Linings
 Lucas-TVS

Japan Quality Medal
 Sundaram Clayton

TPM Excellence awards
 Sundram Fasteners
 Brakes India
 TVS Motor Company
 Sundaram Auto Components Ltd
IR meeting – June’2010
Slide no. 5
India remains a lucrative market
253
148
900
600
687
India
Brazil
China
55
773
850
935
1,029
600
300
FY12E
0
Source: CSO, ENAM Research
IR meeting – June’2010
Indonesia
($)
FY11E
 Emergence of a large young working
population
59
Increasing per-capita income
1,200
FY10E
 Lack of public transport
Source: KPMG
FY07

Strong GDP growth at 8%+ augurs
well for the Indian economy
Rising per capita income to enhance
affordability, and demand for twowheelers
Vietnam
64
as China, Indonesia etc.

236
FY09
low compared to other countries such
(per
1000)
595
Thailand
 However, penetration levels still very
700
600
500
400
300
200
100
0
FY08
India is the second largest twowheeler market in the world with
sales of ~9.4 mn units in domestic
market in FY10
Taiwan

Low penetration rate despite India
being 2nd largest market
Slide no. 6
India – Macro perspective

Secular rural demand
 Stimuli such as NREGA will help
positive thrust in rural
consumption
 Higher MSP

Retail Financing improving
with structural changes
 CIBIL checks mandatory
Credit sales improving
60
(%)
50
50
40
30
30
20
20
10
0
FY07
FY10
FY11E
 Higher down payment
 Absence of DSAs
 Tighter credit norms
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Slide no. 7
Two Wheeler Industry – Average Monthly sales
900
876
(nos. in 000’s )
631
665
674
706
548
600
310
360
420
469
300
0
00-01 01-02 '02-03 03-04 '04-05 '05-06 '06-07 '07-08 '08-09 '09-10
Motorcycles
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Ungeared scooters
Mopeds
Scooters
Slide no. 8
Motorcycles – Industry Structure
100%
10%
11%
49%
50%
13%
14%
15%
75%
53%
57%
50%
60%
25%
41%
39%
2005-06
6.19 mn
2006-07
7.08 mn
34%
29%
25%
2007-08
6.55 mn
2008-09
6.81mn
2009-10
8.43 mn
0%
Economy
Executive
Premium
Executive segment, the key focus area
IR meeting – June’2010
Slide no. 9
TVSM – poised for Quality growth
IR meeting – June’2010
Slide no. 10
TVSM - Company overview
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

One of the largest two and three wheeler companies
A state of the art manufacturing plants located in Karnataka,
Tamil Nadu, Himachal Pradesh and Indonesia
Capacity 24 lakh vehicles (2009-10) being increased to 28
Lakhs

Strong World class in-house R & D

Robust supplier base

Extensive all India sales & service network

Rapid growth in exports

Sales ( 2009-10) : Rs. 4431 Cr.
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Slide no. 11
Strong presence in all 3 segments
(nos. in 000’s )
1520
1700
1277
1342
1325
572
409
866
438
950
258
259
310
610
645
638
575
200
2007-08
Motorcycles
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2008-09
Scooters
2009-10
Mopeds
Slide no. 12
Strong All India distribution network
Number of Dealers
641
January 2010
97
180
137
227
North
South
West
East
TVSM has a robust two tier distribution network with 641 exclusive
dealers supplemented by more than 2000 sales & service points
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Slide no. 13
Complete product range
Ex-Showroom price-Bangalore (June’10)
60000
Apache
series
50000
45000
WeGo
40000
Streak
35000
Flame SR 125
Jive
StaR series
Scooty Pep
30000
25000
20000
XL Super / Heavy duty
15000
MOPEDS
UNGEARED
SCOOTERS
MOTORCYCLES
A complete portfolio with product at every price point
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Slide no. 14
TVS Jive – 110cc



India’s first auto clutch motorcycle
Launched in April’10 with pan-India availability by June/ July’10
Positioned in the Executive segment, which accounts for 60%+ of
the motorcycle market
 Initial response very satisfactory.
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Slide no. 15
TVS Apache RTR – 180cc
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Slide no. 16
Un-geared Scooters – Steadily gain momentum

Industry

CAGR (5 years) 12%
 Account for 14% of the two wheeler segment

TVSM
 TVSM strong in the sub 100 segment. However overall TVSM Market
share lower in the absence of bigger scooter.
 Launch of WeGo will address this issue
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Slide no. 17
Under seat storage
illumination
Self glow ignition key ring
Now visible in the dark
No more fumbling in the
dark
New 90 cc engine
Best Design of
the year 2008
More power for that
zippy ride
Overdrive awards
Cell phone charger
Get charged on the move!
Patented EZ center stand
Trendy decals
A vibrant & stylish look
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No huffing. No puffing. Park
effortlessly
Slide no. 18
Scooty Streak
Launched in Sept 2008 With 6 never before features, and
leading edge styling
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Slide no. 19
TVS WeGo – 110cc


Multi-user friendly vehicle
Equipped with




Unique design technology - Body Balance
Large 12 inch alloy wheels
Big internal storage space
LED tail lamp
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Slide no. 20
The stylish TVS KING
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Slide no. 21
The stylish TVS KING

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TVS entered the 3W market towards the end of
FY08, with TVS-King.
TVS-King engineered with ‘best in class’ features.
Achieved average monthly Sales of 2500 nos in
April/May ‘2010

Large potential for exports.

Target of 50,000 units in FY11 (14,700 units in FY10)
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Slide no. 22
TVS Neo – The emerging opportunity
Indonesia
TVS Neo



Third largest market in the world with volumes over 6mn units p.a.
TVS has a local assembly plant with a capacity of 0.3 mn units p.a.
Launched TVS Neo , TVS Rockz and Apache in the Indonesian
market
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Slide no. 23
Awards in Indonesia
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Slide no. 24
TVS Motor’s Standalone performance 2009-10
Rs Cr
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Slide no. 25
Summary

Long term growth prospects for the industry are attractive

TVSM poised to grow
 Strong innovation and faster upgrades
 Strong brands that resonate with their customers
 Exports will be a significant growth engine
 Entry into three wheeler has enhanced product portfolio

Significantly improved/ superior product quality



New products across segments, will strengthen TVS’ presence and lead to market
share gains
Improved product mix likely to increase realizations and profitability
Focused efforts to reduce cost will improve profitability

Strong free-cash flow expected
IR meeting – June’2010
Slide no. 26
Thank you
No part of this presentation is to be circulated, quoted, or
reproduced for any distribution without prior written approval
from TVS Motor Company Limited, PB 4, Harita, Hosur-635109,
Tamilnadu, India. Certain parts of this presentation describing
estimates and future plans may be
“forward looking
statements” within
the meaning of applicable laws and
regulations. Actual results might differ materially from those
either expressed or implied. This material is not a complete
record of the discussion.
IR meeting – June’2010
Slide no. 27